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ELCPartially AllowedELC Case of 2017 (Meru), Plaint dated 5th June 2017· [2020] KEELC 3251 (KLR)

Olerai Energy and Infrastructure Limited v Elizabeth Kaliungu Angaine [2020] KEELC 3251 (KLR)

Environment and Land Court
26 February 2020
LML.N. Mbugua
5,149 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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What this practically means

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Executive summary

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The plaintiff company sued the defendant landowner over lease agreements dated 1st and 15th November 2010 covering 15 acres and a residential house on LR 20737/26 in Timau, Meru, plus an oral lease over a further 11 acres. It sought a permanent injunction, special damages, and general damages for trespass, alleging the defendant subdivided the leased land without disclosure, demanded excessive rent and destroyed its electric fence, trees and equipment. The defendant admitted the written leases but claimed rent arrears, denied authorising the destruction, and argued the leases were void for want of Land Control Board consent and non-registration. The court framed four issues: validity of the leases, the term of the oral lease over the 11 acres, rent arrears, and trespass. Applying Willy Kimutai Kitilit v Michael Kibet, it held the leases valid and enforceable, the defendant being estopped by having given possession and received rent. The oral lease over the 11 acres was found to run 10 years based on the parties' conduct. On rent, the court set off Kshs 3,920,000/= (the unpaid fencing costs by the plaintiff's sister company, the 5% interest claim failing) and Kshs 500,000/= for medical expenses, finding no rent arrears. Trespass and the associated special and general damages failed for want of proof connecting the destruction to the defendant. The suit partially succeeded: a permanent injunction was issued for the duration of the lease terminating 15th November 2020, with costs to the defendant.

Key legal issues

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01

Validity of lease agreements lacking Land Control Board consent and registration

Holding

The leases were valid and enforceable because the defendant gave possession and received rent, and is estopped from pleading invalidity; constructive and proprietary estoppel cure the defects

Reasoning

Section 6 of the Land Control Act renders controlled transactions void without consent, and consent ought to be sought within six months under Section 8. However, following Willy Kimutai Kitilit v Michael Kibet, the doctrines of constructive trust and proprietary estoppel may apply to transactions void for want of consent. The defendant gave possession, received rent and agreed that consent was unnecessary between friends; she is thus estopped from denying enforceability. The same reasoning cures non-registration under Section 40 of the Registration of Titles Act.

p. 5
02

Term of the oral lease over the additional 11 acres

Holding

The oral lease was for 10 years, not 5 years as the defendant alleged

Reasoning

The oral agreement conflicted: plaintiff said 10 years, defendant 5 years. The court examined the parties' conduct: the defendant was still claiming rent for land in the plaintiff's continuous possession, and never launched any claim for recovery of the 11 acres upon expiry of the alleged 5-year term. Together with the 10-year written leases, this conduct supported the plaintiff's assertion of a 10-year term.

p. 5
03

Whether the plaintiff was in rent arrears

Holding

The plaintiff was not in rent arrears; after setting off Kshs 3,920,000/= for the unpaid balance of the fencing costs and Kshs 500,000/= for medical expenses, only Kshs 425,204/= would be owing to the end of the lease

Reasoning

The court accepted that the fencing by the sister company cost Kshs 7,920,000/= after negotiation (down from a quotation of Kshs 8,640,000/=) and that the defendant paid Kshs 4,000,000/=, leaving Kshs 3,920,000/= as set-off against rent. The claim of 5% interest was not proved. Cumulative rent to 2020 was Kshs 13,084,526/=; receipts of Kshs 8,239,322/= plus Kshs 3,920,000/= plus Kshs 500,000/= totalled Kshs 12,659,322/=, leaving Kshs 425,204/= owing to 2020 — hence no arrears as pleaded.

p. 5
04

Whether the defendant committed trespass and damaged the plaintiff's property

Holding

Trespass was not proved; the plaintiff failed to connect the acts of destruction to the defendant

Reasoning

Relying on Sections 107, 109 and 112 of the Evidence Act and Kirugi & Another v Kabiya, the burden lay on the plaintiff to prove trespass on a balance of probabilities. Although photographs of destruction existed, there was no evidence linking the alleged invaders to the defendant, who denied entry and damage. Special damages also failed for want of assessment reports and receipts.

p. 6

Legal principles established

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  • A transaction on agricultural land requiring Land Control Board consent, though void for want of consent, may be rendered enforceable by the doctrines of constructive trust and proprietary estoppel where possession has been given and consideration paid
  • The burden of proving a case lies on the plaintiff on a balance of probabilities even where the defence does not contest the case

Court orders

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  1. 1.A Permanent Injunction restraining the Defendant, her agents, tenants, servants and employees from subdividing, selling, constructing, leasing, trespassing on or damaging the leased property LR 20737/26 and its subdivisions (LR 20737/37, 20737/38, 20737/59 and 20737/67) for the duration of the lease dated 15th November 2010 terminating 15th November 2020
  2. 2.Costs of the suit to be borne by the defendant

Authorities

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Legislation

  • Land ActSection 65(1)(a); Section 38(2)
  • Land Control ActSections 6, 7, 8, 9(2)
  • Registration of Title ActSection 40
  • Law of Contract ActSection 3(3)
  • Evidence ActSections 107(1) and (2), 109, 112

Cases cited (8)

  • Obadiah Macharia Vs Kenya Power & Lighting Company Limited
    Nyeri ELC case number 716 of 2014
  • Lucy Wangui Gachar Vs Minudi Okemba Lore
    Malindi Civil Appeal No. 4 of 2015
  • Paul Githonga Wanjau Vs Gathuthi Tea Fcatory Company Ltd & 2 Others
    Civil suit No. 28 of 2015
  • Mohamed Ali & Another Vs Sagoo Radiators Limited
    (2013) e K.L.R
  • David Sironga OeThikai Vs Francis Arap Musa & Others
    (2004) e K.L.R
  • Stephen Oyoti Okemwa Vs Halima K. Saleh
    Nyeri C.A No. 30 of 2016
  • Willy Kimutai Kitilit Vs Michael Kibet
    [2018] e KLR
  • Kirugi & Another Vs Kabiya & 3 others
    [1987] KLR 347
Jurisdiction invoked
Original jurisdiction of the Environment and Land Court under Article 162(2)(b) of the Constitution (not expressly cited in the judgment)

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Olerai Energy and Infrastructure Limited v Elizabeth Kaliungu Angaine [2020] KEELC 3251 (KLR)", Case Analysis (2020). ELC Case of 2017 (Meru), Plaint dated 5th June 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2020/3251/eng@2020-02-26

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.